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WHY THE CURRENT YEAR CAN MEAN THE UKRAINIAN BUILDING MARKET IN COLLAPSE

Some believe that their forecasts are too pessimistic, arguing that the construction industry can not be stopped. But the statistics of falling sales of housing on the background of the rapid growth in the number of residential complexes being built testify to the opposite. Already, many companies finance the completion of houses due to the sale of square meters in new facilities and massively transfer the planned commissioning for a year or more.

The market of primary real estate on the verge of collapse

The soap bubble will burst, as in 2009, only the scale will be much larger. In the long-term can turn about 90% of the currently under construction. The beginning of this trend can be observed already this year, more than half of current investors will not be able to obtain real estate for which they paid money.
In Kiev there are more than 100 construction companies, which have a lot of contractors. With problems of financing of the constructed objects, almost everyone will face. The collapse was to happen last year. But taking into account that the banks collapsed and investors took their money, investing them in real estate, it delayed the process for some time. But even this money is running low. Developers with the help of various actions are trying to "fool" the people of the latter.
Just stretch commissioning for years. Partly because the construction industry came amateurs, who begin to "pull out" profits until the moment of putting the object into operation.
Forecasts are far from groundless: the majority of the surveyed construction companies in the capital state a sharp drop in demand. However, officially the leaders of companies are silent about this. This is fairly private information and the market is not openly talking about it. But in informal conversations, middle managers report a catastrophic reduction in the number of investors.
The decline in sales began in October-November 2016, since February this year sales have fallen very much. For example, in April, which has always been characterized by a surge in activity, the drop in sales compared to April last year was 50%. And this is in the economy segment, where very cheap apartments are being built, for which demand remains. All that is more expensive (business segment) is a complete calm.

Money ends, the offer grows

The number of square meters put into operation in 2016 does not exceed this figure a year earlier. But the number of residential buildings being built is now over the top. Only in Kiev, apartments from developers are sold in 285 complexes. Another 287 residential complexes are under construction in the Kiev region, and 177 of them - in the Kiev-Svyatoshinsky district. According to the data of the LUN.ua portal, only in Irpen there are 84 new buildings, in Vyshneve - 82, in Sofia Borshchagovka - 26 new complexes, in Buche - 19, in Petropavlovskaya Borshchagovka - 8, in Gostomel - 6.
Moreover, some of the complexes under construction are very large. For example, the project LCD "Scandia" in Brovary provides for the erection of 80 hectares of 100 houses with a maximum floor space of up to 7 floors.
The project "Europeka" in Sofia Borshchagovka includes 112 houses with a height of 4 to 6 floors, which are built on an area of ​​20 hectares (designed for about 12,000 people). The Nova Bucha residential complex, built last year, provides for the construction of 82,000 houses for 20,000 residents. LCD «Ozerny Gai» in Gatny, which is located on 48 hectares, has 5 thousand apartments. The developer of the LCD "Sofia Residences" in Sofia Borshchagovka plans to build 50 houses on 50 hectares. The total volume of housing that went on sale is several times higher than in previous years.
Against this background, the number of solvent citizens who have the opportunity and the desire to invest in the projects under construction is inexorably shrinking.
All who could, have already made money, all who wanted to - spent it on real estate. Just so no one will buy - taking into account taxes and high utility tariffs, buying apartments will be just like the first housing for themselves. To save the situation, developers are massively reoriented to small-scale smart apartments. But there the cost of a square meter is more expensive, because In every room you have to start all communications.
Tightening of the struggle for the client forces builders to further reduce the cost per square meter. Therefore, the liquidity of many projects is slowly slipping to zero.
Already in the construction market there is the emergence of financial pyramids, when the completion of the house is financed by investors of the new house. This is confirmed by statistics: in 2016 the share of unsold apartments for the period of construction, which later fall on the secondary market, was about 5% in Kiev, and about 12% - in the region. Now their share has grown to 12% and 25% respectively.

Myths and reality of country life


In the opinion of the experts interviewed, the developers of the suburbs of the capital are the most vulnerable, the sales decline in which is stimulated by the lack of engineering, transport and social infrastructure. There may be real problems: Wrong land assignment. Violation of the number of storeys. There are no communications. Water is an illegal tap, steal. Sewerage - a tear in the decommissioned blocked collector. When the level is filled - the feces will go fountain. Electrician - from a diesel generator on the street. Heating - a pellet boiler in the basement with a threat to get poisoned from CO2 to death.


Building complexes with similar problems near Kiev dozens.


And this is not all listed problems. These include the lack of kindergartens, schools and polyclinics, and a poorly developed network of public transport. Sooner or later, potential buyers will come to understand that in addition to the price for these projects, nothing stands. There are problems with the arrangement of engineering networks, primarily sewers. And of course the transport infrastructure is already out of many suburbs during rush hour is impossible. The fields are being built up wildly and uncontrollably, the local authorities only need to get the money, and the consequences do not worry them. This collapse, especially the right-bank part - Sofievskaya and Petropavlovskaya Borshchagovka, Vishneve, Petrovsky.

However, the developers themselves are not so pessimistic. Part of the small builders can really stop work and freeze their facilities.
Another part - will post the terms of putting houses into operation for 2-3 years. There will not be a full collapse. Suppliers of building materials and companies that provide construction services (equipment rental) understand that there is no money, and are willing to work on barter, in part per square meter. What's the point of picking up a crane from the site, if no one takes it out? Faced with financial problems, developers will gradually reduce the volume of construction work, but do not freeze them. They perfectly understand: as soon as the cranes stop and the traffic on the construction site stops - this is the end.
But even in the case of minimizing costs, developers still need financing - you have to pay bills, fulfill obligations to contractors, feed builders. The question is - how long they will be able to do this in the absence of sales.

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